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Ministry of Finance AR 2020 Cover ANNUAL REPORT 2019 Ministry of Finance Sri Lanka ANNUAL REPORT 2019 MINISTRY OF FINANCE SRI LANKA THIS FINAL BUDGET POSITION REPORT, ANNUAL REPORT 2019, IS PUBLISHED IN TERMS OF SECTION 13 OF THE FISCAL MANAGEMENT (RESPONSIBILITY) ACT, NO. 3 of 2003 ISBN 978–955–0814–28–2 Printed at Softwave Printing and Packaging (Pvt) Ltd, 107 D, Havelock Road, Colombo 05 and published by the Ministry of Finance, The Secretariat, Lotus Road, Colombo 01, Sri Lanka. MINISTRY OF FINANCE (AS AT 30TH APRIL 2020) Hon. Mahinda Rajapaksa, M.P. Minister of Finance, Economic and Policy Development Hon. Shehan Semasinghe, M.P. State Minister of Development Banks and Loan Schemes* PRINCIPAL OFFICIALS S.R. Attygalle Secretary, Ministry of Finance, Economic and Policy Development Secretary to the Treasury A.K. Seneviratne Deputy Secretary to the Treasury R.M.P. Rathnayake Deputy Secretary to the Treasury P. Algama Deputy Secretary to the Treasury H.G. Sumanasinghe Additional Secretary H.H. Kasthuriarachchi Director General D.D. Mataraarachchi Secretary, State Ministry of Development Banks and Loan Schemes* * AS AT 31ST DECEMBER 2019 HEADS OF TREASURY DEPARTMENTS (AS AT 30TH APRIL 2020) Department of National Budget Department of Trade and Investment Policy S.D.J. Nilukshan K.A. Vimalenthirarajah Actg. Director General Director General G.M.J.K. Gunawardana M.K.P. Kumara Additional Director General Additional Director General Ms. M. Anoma Nandani Additional Director General Comptroller General’s Office Ms. K.A. Ramya Kanthi Department of Public Enterprises Actg. Comptroller General P.A.S. Athula Kumara Actg. Director General Department of Development Finance Ms. K.G.K. Wimalaweera Ms. D.C.W. Hapugoda Director General Additional Director General K.A.S.S.K. Perera P.H.A.S. Wijayarathne Additional Director General Additional Director General Department of Public Finance Sunil Galagama Ms. J.C. Weligamage Additional Director General Actg. Director General Department of Management Services Ms. Hiransa Kaluthantri S.U. Chandrakumaran Actg. Director General Additional Director General A.M.P. Arampath E.A. Rathnaseela Additional Director General Additional Director General Department of Fiscal Policy Department of Treasury Operations M.K.C. Senanayake R.M.A. Ratnayake Actg. Director General Director General J.M.R.P. Jayasinghe H.C.D.L. Silva Additional Director General Actg. Additional Director General Ms. M.K.D.N. Madampe R.M.D.K.G.N.B. Ranatunga Additional Director General Actg. Additional Director General Department of State Accounts Ms. K.D.R. Olga Director General T.N. Ossen Additional Director General HEADS OF TREASURY DEPARTMENTS (AS AT 30TH APRIL 2020) Department of Information Technology Department of National Planning Management R.H.W.A. Kumarasiri A.V. Janadara Director General Actg. Director General K.D.S.R. Perera S. Giridaran Additional Director General Additional Director General Ms. C.S. Perera Department of Legal Affairs Additional Director General Director General Ms. J.S.S. Rupasinghe Department of External Resources Additional Director General D.A.P. Abeysekera Director General Ms. M. Gangatharan Additional Director General M.M. Noufal Additional Director General J.M.S.D. Rathnayake M.A.L.S.N.K. Manthreenayake Additional Director General Additional Director General Government Auditor Department of Project Management and S.M.D.S.S. Rohitha Monitoring Deputy Auditor General Ms. P.K.A.D. De Silva Director General N.S.M.P. Ranjith Additional Director General M.H.M. Zameel Additional Director General S.M. Dayarathna Additional Director General Ms. K.D.A. Munasinghe Additional Director General Department of Management Audit Ms. S.A. Chandrika Kulathilake Actg. Director General A.N. Hapugala Additional Director General HEADS OF DEPARTMENTS UNDER THE PURVIEW OF THE MINISTRY OF FINANCE (AS AT 30TH APRIL 2020) Department of Inland Revenue Nadun Guruge Commissioner General of Inland Revenue Department of Sri Lanka Customs G. Vijitha Ravipriya Director General of Customs Department of Excise A. Bodaragama Commissioner General of Excise Department of Valuation Ms. P.D.D.S. Muthukumarana Chief Valuer Department of Census and Statistics Ms. I.R. Bandara Director General Department of Imports and Exports Control Ms. T.V.D.D.S. Karunarathne Controller General Department of Commerce Nimal Karunatilake Director General of Commerce Department of Registrar of Companies D.N.R. Siriwardena Registrar General of Companies HEADS OF STATUTORY BOARDS / OTHER INSTITUTIONS UNDER THE PURVIEW OF THE MINISTRY OF FINANCE (AS AT 30TH APRIL 2020) Sri Lanka Insurance Regulatory Commission Hotel Developers (Lanka) PLC Razik Zarook J.M.U.P. Jayamaha Chairman Chairman Sri Lanka Accounting and Auditing National Lotteries Board Standards Monitoring Board Lalith Piyum Perera Ms. K.M.A.N. Daulagala Chairman Chairperson Development Lotteries Board Public Service Mutual Provident Association Ms. Nalini Abeywardhana R.A.T.A. Ranaweera Chairperson President Sri Lanka Insurance Corporation Ltd Lady Lochore Loan Fund Jagath Wellawatta S. Winston Pathiraja Chairman Chairman Litro Gas Lanka Ltd Tax Appeals Commission Anil Koswatta Justice Hector Yapa Chairman Chairman National Insurance Trust Fund Sri Lanka Export Credit Insurance B.K.R. Balasooriya Corporation Chairman A.H. Wijesiri Ambawatta Chairman & Managing Director Miloda (Academy of Financial Studies) Anura Lokuhetti Securities and Exchange Commission of CEO Sri Lanka Viraj Dayarathne People’s Bank Chairman Sujeewa Rajapakse Chairman Credit Information Bureau of Sri Lanka Bank of Ceylon C.J.P. Siriwardena Kanchana Ratwatte Chairman Chairman Public Utilities Commission of Sri Lanka Sri Lanka Savings Bank Prof. Kithsiri Liyanage H.N.J. Chandarasekara Chairman Chairman National Savings Bank Ms. Keasila Jayawardane Chairperson HEADS OF STATUTORY BOARDS / OTHER INSTITUTIONS UNDER THE PURVIEW OF THE MINISTRY OF FINANCE (AS AT 30TH APRIL 2020) Central Bank of Sri Lanka Prof. W.D. Lakshman Governor Regional Development Bank J.T.S. Prasanna Kariyawasam Chairman Sri Lankan Airlines Ltd Ashok Pathirage Chairman State Mortgage & Investment Bank Udaya Sri Kariyawasam Chairman CONTENTS Part I: Macro-Fiscal Perspectives CHAPTER 1 : Developments in Fiscal Policy, Strategy and Challenges 03 1.1 Overview 04 1.2 2020 Fiscal Operations 12 1.3 The Way Forward 14 1.4 Medium-Term Strategy and Outlook 2020 – 2024 17 CHAPTER 2 : Economic Developments in 2019 19 2.1 Overview 20 2.2 Sri Lankan Economy 20 2.3 External Sector 31 2.4 Monetary Sector Developments 37 2.5 Inflation 39 2.6 Employment and Unemployment 40 2.7 Equity Market Developments 40 2.8 Global Economic Environment and Prospects 41 Part II: Final Budget Position CHAPTER 3 : Government Revenue 49 3.1 Overview 50 3.2 Revenue Policy Measures – 2019 52 3.3 Tax Policy Reforms – 2019/2020 52 3.4 Government Revenue Performance 54 CONTENTS CHAPTER 4 : Government Expenditure 71 4.1 Overview 72 4.2 Appropriation Act for 2019 and Vote on Account 2019 72 4.3 Supplementary Estimates 73 4.4 Revised Budget for 2019 73 4.5 Budgetary Performance 74 4.6 Advance Account Activities 74 4.7 Public Expenditure Management 74 4.8 Composition of Government Expenditure 94 4.9 Sectoral Classification of Government Expenditure 95 CHAPTER 5 : Cash Flow Management, Deficit Financing and Debt 109 5.1 Overview 110 5.2 Treasury Cash Flow Management 110 5.3 Government Borrowing Programme – 2019 111 5.4 Financing of the Budget 111 5.5 Central Government Debt 115 5.6 Debt Service Payments 122 Part III: Functional Performance and Reforms CHAPTER 6 : Development Finance 127 6.1 Overview 128 6.2 Financial and Technical Support for SMEs 129 6.3 Supports to Agricultural Development 132 6.4 Assistance to Plantation Sector 137 6.5 Food Security 138 6.6 Livestock Sector Development 141 6.7 Special Incentives for Targeted Groups 143 CONTENTS CHAPTER 7 : Performance of State Owned Enterprises (SOEs) 145 7.1 Overview 146 7.2 Energy 150 7.3 State Banks 155 7.4 Water 160 7.5 Ports 161 7.6 Insurance 162 7.7 Commuter Transportation 164 7.8 Aviation 165 7.9 Construction 167 7.10 Lotteries 168 7.11 Livestock and the Dairy 170 7.12 Marketing and Distribution 171 7.13 Plantation 172 CHAPTER 8 : Public Finance Management 181 8.1 Overview 182 8.2 Electronic Government Procurement (E-GP) 182 8.3 Statutory and Non-Statutory Funds 183 8.4 Parliament Control over Public Finance 183 CHAPTER 9 : Human Resources Management 187 9.1 Overview 188 9.2 Cadre Management – 2019 188 9.3 Distribution of Public Service Cadre (Excluding Tri-Forces) by Service Level – 2019 189 9.4 Cadre of Government Development Projects 189 9.5 Public Sector Cadre at a Glance 190 CONTENTS Part IV: Financial Statements 195 BOX ARTICLES Box 1.1 Major Fiscal Measures: January – May 2020 07 Box 1.2 Key Police Responses to COVID-19 15 Box 3.1 Major Fiscal Measures: January – December 2019 63 Box 6.1 Debt Relief Package for Revitalizing Small and Medium-sized Enterprises (SMEs) 130 Box 7.1 The Way Forward for SOEs 147 Box 7.2 Fuel Price Stabilization Fund 148 Box 9.1 Application of IT on HRM: Policy Responses to COVID-19 191 STATISTICAL APPENDIX Table 1 Sri Lanka: Demographic and Related Trends 338 Table 2 Climate 339 Table 3 Gross Domestic Product (GDP), Inflation and Exchange Rate 340 Table 4 Gross Domestic Product-Sectoral Composition (2010) Constant Prices 341 Table 5 Savings, Investments and Selected External Sector Indicators 343 Table 6 Economic Classification of Government Fiscal Operations 344 Table 7 Economic Classification of Government Fiscal Operations 345 Table 8 Economic Classification
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